May 30, 2007

Marketing of Innovative and Disruptive Technologies

There are many disruptive innovations happening these days and unlike the dot.com days, these are nimble start-ups powered by an open innovation software ecosystem and exploding networks. With any disruptive business models, the key challenge they face is how do you drive adoption and how fast can you do it? Marketing innovative products and technologies are very different from conventional product marketing.

Let’s first define what is an innovative product or service? I define it as something that offers next-step improvements of existing ideas or offering high value / performance at an affordable price. It can be evolutionary or revolutionary, or it is not that easy to draw the distinctions?

Let’s try again. An evolutionary product is one that is an extension of an existing technology and is typically compatible with older, established technologies but incompatible with new, competitive technologies. In contrast, a revolutionary technology is one that does not offer compatibility with existing technologies but may offer superior performance. So let’s use the Nintendo Wii as an example, while it is fully compatible with older games but at the same time it offers very revolutionary features targeting non-gamers. Or if we take the PS3 as another example, it is a big step forward from a performance point of view and incorporating many advanced features and yet still compatible with many existing technologies. Is that revolutionary?

The key is to look at whether they improve the performance of established products, along the dimensions of performance that mainstream customers in major markets have historically valued. Or they can aim at different sets of dimensions and create new markets. Sometimes disruptive technologies result in a worse performance, at least in the short term. Disruptive technologies perform established products in mainstream markets. But they have certain unique features that a particular segment of customers or markets finds valuable. Products based on disruptive technologies are typically cheaper, simpler, smaller, and easier to use or sometimes perform tasks in the background without the user knowing it. This is where Customer Experience Innovation comes into play.

Here’s a truly disruptive innovation, Google's attempt to make all of the world's information searchable now extends to the human genome. Google has just invested $3.9 million in 23andMe, a start-up company that enables users to search their genetic profiles online. Google said that the investment was made as 23andMe’s goal of developing new ways to help people make sense of their genetic information will help us further our mission of organizing the world’s information in this new and important field. That is truly revolutionary. Not sure what exciting things will happen when they combine your search record with your genetic profiles? That’s a marketer’s dream!

A disruptive technology typically challenges all previously held assumptions and threatens all the painfully acquired knowledge - not only internally (within a company or the industry) but also externally with customers. The introduction of a disruptive technology is an incredibly painful process. Like a hurricane or a tornado, it wipes out or makes the years spent learning languages and systems, investing in tools and programs, acquiring market knowledge and information, obsolete. If you are interested you can download part of my presentation through this link.http://www.highintensitymarketing.com/images/mktofinnovativeproductsdownload.pdf#search=%22site%3Awww.highintensitymarketing.com%2F%22

Comments

Marketing of Innovative and Disruptive Technologies

There are many disruptive innovations happening these days and unlike the dot.com days, these are nimble start-ups powered by an open innovation software ecosystem and exploding networks. With any disruptive business models, the key challenge they face is how do you drive adoption and how fast can you do it? Marketing innovative products and technologies are very different from conventional product marketing.

Let’s first define what is an innovative product or service? I define it as something that offers next-step improvements of existing ideas or offering high value / performance at an affordable price. It can be evolutionary or revolutionary, or it is not that easy to draw the distinctions?

Let’s try again. An evolutionary product is one that is an extension of an existing technology and is typically compatible with older, established technologies but incompatible with new, competitive technologies. In contrast, a revolutionary technology is one that does not offer compatibility with existing technologies but may offer superior performance. So let’s use the Nintendo Wii as an example, while it is fully compatible with older games but at the same time it offers very revolutionary features targeting non-gamers. Or if we take the PS3 as another example, it is a big step forward from a performance point of view and incorporating many advanced features and yet still compatible with many existing technologies. Is that revolutionary?

The key is to look at whether they improve the performance of established products, along the dimensions of performance that mainstream customers in major markets have historically valued. Or they can aim at different sets of dimensions and create new markets. Sometimes disruptive technologies result in a worse performance, at least in the short term. Disruptive technologies perform established products in mainstream markets. But they have certain unique features that a particular segment of customers or markets finds valuable. Products based on disruptive technologies are typically cheaper, simpler, smaller, and easier to use or sometimes perform tasks in the background without the user knowing it. This is where Customer Experience Innovation comes into play.

Here’s a truly disruptive innovation, Google's attempt to make all of the world's information searchable now extends to the human genome. Google has just invested $3.9 million in 23andMe, a start-up company that enables users to search their genetic profiles online. Google said that the investment was made as 23andMe’s goal of developing new ways to help people make sense of their genetic information will help us further our mission of organizing the world’s information in this new and important field. That is truly revolutionary. Not sure what exciting things will happen when they combine your search record with your genetic profiles? That’s a marketer’s dream!

A disruptive technology typically challenges all previously held assumptions and threatens all the painfully acquired knowledge - not only internally (within a company or the industry) but also externally with customers. The introduction of a disruptive technology is an incredibly painful process. Like a hurricane or a tornado, it wipes out or makes the years spent learning languages and systems, investing in tools and programs, acquiring market knowledge and information, obsolete. If you are interested you can download part of my presentation through this link.http://www.highintensitymarketing.com/images/mktofinnovativeproductsdownload.pdf#search=%22site%3Awww.highintensitymarketing.com%2F%22